Security Analysis and the Collection of Hard and Soft Information

We use minute-by-minute Bloomberg online status microdata during 2017-2021 to directly study how hard and soft information collection affects equity analyst performance. Collection of hard information, proxied by office workday length, is positively associated with the quantity and timeliness of analyst reports. Soft information collection, as proxied by propensity to travel, is positively correlated with the market’s reaction to recommendation changes and the likelihood of becoming a star analyst. Both hard and soft information collection improve forecast precision, a causal result that we confirm using the COVID lockdown as an instrument.